Durable and Special Powers of Attorney in Pennsylvania
You may need more than a general Power of Attorney form.
Who will take care of your financial matters if you develop health problems that make it impossible for you to handle them yourself? Who will make decisions regarding your healthcare if you become incapacitated? With proper planning, and the help of a legal professional, the answer can be quite simple - you can choose who you want to handle these matters for you by preparing a Power of Attorney (POA).
A Pennsylvania power of attorney is a legal document that you (the "principal") can use to give someone else (your "agent" or "attorney-in-fact") the authority to make financial and other decisions on your behalf. You can give your agent as much or as little power as you wish. You may want to give your attorney-in-fact authority to do some or all of the following:
use your assets to pay your everyday expenses and those of your family
buy, sell, maintain, pay taxes on and mortgage real estate and other property
collect benefits from Social Security, Medicare, or other government programs or civil or military service
invest your money in stocks, bonds, and mutual funds
handle transactions with banks and other financial institutions
buy and sell insurance policies and annuities for you, and change your beneficiary designations
file and pay your taxes
operate your small business
claim property you inherit or to which you are otherwise entitled
hire someone to represent you in court, and
manage your retirement accounts.
There are several types of powers of attorney, and this is where a standard form Power of Attorney will not be able to take the place of a knowledgeable lawyer. A lawyer can answer your questions, can analyze your situation, and can recommend options to you far better than a free Power of Attorney form ever could. You get what you pay for.
Your choices include a Limited Power of Attorney, a General Power of Attorney, a Durable Power of Attorney for Finances, a Durable Power of Attorney for Healthcare, and a Springing Power of Attorney. Preparing one or more of these documents will ensure that your health and financial matters will stay in the hands of trusted people you choose.
A distinguishing feature among the different types of powers of attorney is the issue of revocation. As long as you are competent, all powers of attorney are revocable at any time for any reason or no reason at all. However, some powers of attorney are automatically revocable. For example, if you become mentally disabled, Limited and General Powers of Attorney will expire. On the other hand, a Durable Power of Attorney remains effective if you become incapacitated. A Springing Power of Attorney does not even become effective unless you become mentally disabled or otherwise incapacitated.
A Limited Power of Attorney grants someone else the authority to take some specific action or actions on your behalf. For example, if you are planning an extended vacation, you may want to grant someone the power to execute checks for you and pay your bills. You may find it necessary to give someone the authority to sell a particular piece of real estate for you, or to conduct some other similar dealing related to your line of business. Whatever powers you give your attorney-in-fact, that person must act in your best interest, keep accurate records, keep your property separate from his or her own, and avoid conflicts of interest. The Limited Power of Attorney is very narrow, and as previously mentioned, ends if you become incapacitated.
A bit broader than the Limited Power of Attorney is the General Power of Attorney. It too expires when the principal becomes incapacitated. If your desire is to grant someone the general power to act in your behalf in all financial matters, not just a specific matter as with the Limited Power of Attorney, then the General Power of Attorney is for you.
The main distinguishing feature of a Durable Power of Attorney is its irrevocability - it remains valid and in effect even if you become incapacitated and unable to make decisions for yourself. There are two major kinds of durable powers of attorney: one for finances and one for healthcare. Unless stated otherwise, a durable power of attorney goes into effect as soon as you sign it. Preparing these two documents along with a healthcare directive that details your wishes for medical care (commonly referred to as a "Living Will"), ensures that your health and financial matters are handled by people whom you trust.
One of the main reasons to make a Durable Power of Attorney is to avoid court proceedings if you become incapacitated. If you do not have a durable power of attorney, your relatives or other loved ones will have to ask a judge to name someone to manage your financial affairs. These proceedings are commonly known as "guardianship" proceedings, and they can be complicated, expensive and embarrassing. Your loved ones must ask the court to rule that you cannot take care of your own affairs - a public airing of a very private matter.
A common misconception is that a Durable Power of Attorney is not necessary if you are married, have a living trust, or hold property in jointly with someone else. This is simply not true - there are many instances where marriage or a joint tenancy alone will not suffice. For example, there are significant limits on a spouse’s right to sell property owned by both husband and wife. In addition, with a living trust, the trustee is limited in that he only has authority over property that the trust owns and few people transfer all their property to a living trust. Similarly, with regard to joint tenancy property, if one owner becomes incapacitated the other has no legal authority to sell or refinance the incapacitated owner’s share. The bottom line is that a properly drafted Power of Attorney can save time, heartache, and money.
A Durable Power of Attorney for Healthcare lets you choose someone to make medical decisions on your behalf if you become incapacitated and cannot make the decisions for yourself. Properly prepared, the Durable Power of Attorney for Healthcare together with an Advance Healthcare Directive (a "Living Will") will ensure that decisions about your health will stay in the hands of people you trust and choose to make those decisions on your behalf.
The powers of attorney described above, as well as the many variations on these themes, can be very valuable tools. It is important that they are drafted correctly. Experienced estate planning lawyers, such as the lawyers at Wolf, Baldwin & Associates, P.C., can answer questions about powers of attorney and about other estate planning documents as well. Over the past thirty years, the lawyers of Wolf, Baldwin & Associates, P.C. have drafted thousands of Powers of Attorney of all different types. We have experience with estate planning, estate and trust administration, and probating Wills in Montgomery County, Berks County, and Chester County. Please consider the attorneys at Wolf, Baldwin & Associates, P.C. when you have questions about a Power of Attorney, and which Power of Attorney form is right for you. Remember, we strive for "Peace of Mind."
We would be honored if you would click here to contact us today. We will be happy to discuss Powers of Attorney with you, as well as Wills, Living Wills, and your entire estate plan. Our consultations for these matters are free.
The materials contained in this web site do not constitute legal advice, and contact with us through this web site does not establish an attorney-client relationship. The legal citations quoted in this web site may not be up-to-date. We provide these materials for general information purposes only. We make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of the information, whether contained on this web site or any other site to which we might link. No web site can substitute for the fully informed, reasoned judgment of a lawyer. You should not rely on any material contained in this web site - instead you should contact one of our attorneys for a full consultation.
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